Groww vs Zerodha vs Angel One: Nuvama says Groww to be less hurt by reduced F&O trading

In a note on unlisted Groww, India's largest retail broker in terms of active clients, Nuvama Institutional Equities said it expects the broking firm to be less hurt by any reduced F&O trading. It said a 5 per cent drop in F&O orders should  drag Groww’s revenue, EBDAT and adjusted profit after tax by 2.5 per cent, 4.8 per cent and 4.4 per cent, respectively.

The brokerage said Groww’s activation rates over FY24–Q1FY26 stood at 33 per cent-plus, which drove down CAC per active client to just Rs 1,441 in FY25, yielding strong EBDAT margin of 59.7 per cent.

"We believe apart from competitive pricing, technology and user interface are key factors driving success. Besides broking, Groww has expanded into lending (MTF, LAS, personal loans), asset and wealth management, insurance distribution—businesses yet to scale up," it said.

Nuvama said Groww’s F&O revenue contribution to total broking revenue during FY24–Q1FY26 may have declined 2814 bps from 90.2 per cent to 62 per cent against Angel One’s decrease of 989 bps to 74.5 per cent, indicating Groww’s lower dependence on F&O orders. It said all of Groww’s client is direct against Angel One’s where clients are also acquired via subbrokers and so AngelOne pays commission to sub-brokers.

"Groww’s cash active clients jumped during FY24-Q1FY26 by 47.7 per cent to 1.03 crore; raising cash retail ADTV market share by 1048bp to 23.1 per cent (versus AngelOne’s up 280 bps to 17.6 per cent). Despite Groww’s F&O active clients falling during FY24–Q1FY26 by 25.9 per cent to 14 lakh, derivative retail ADTV market share surged 684bp to 14.4 per ecnt (versus AngelOne’s up 25 0bps to 21 per cent). While Groww offers services at competitive pricing, its user experience, customer interface are other factors driving success," Nuvama said.

Data showed Groww's active clients stood at 1.19 crore compared with 71 lakh for Zerodha, 69 lakh for Angel One and 23 lakh for Upstox FY26TD. In terms of active client share, it accounted for 26.3 per cent share against Zerodha's 15.6 per cent, Angel One's 15.2 per cent and Upstox's 5 per cent. Nuvama noted that Groww has one of the lowest fee charging in the industry. 

"We estimate that a 5 per cent drop in F&O orders on Q1FY26 financials shall drag Groww’s revenue, EBDAT, adjusted PAT by 2.5 per cent/4.8 per cent/4.4 per cent versus AngelOne’s 2.3 per cent/10 per cent, 5.2 per cent. We believe Angel One’s EBDAT margins shall be more sensitive and is likely to be hurt by 135 bps versus Groww at 122 bps," it said.